Things you need to know about Contract of Lease for Condominium Unit for Commercial Use.
1. What is a Contract of Lease?
A Contract of Lease is an agreement where a property owner (i.e. the lessor) allows another person or corporation (i.e. the lessee) to rent his/her property for a period of time and usually for a fee.
A Contract of Lease sets out the complete terms of the lease and the respective rights and obligations of the parties. The lease contract contains basic provisions such as (a) the amount of rent; and (b) the term of the lease. It may even include other detailed provisions such as provisions on (a) security deposit and; (b) advance rentals. A lease contract created on Legal Tree can be as basic or detailed as you need it to be depending on your situation.
2. When do you need a Contract of Lease?
A Contract of Lease is needed when you want to rent out your property to another person. As the property owner you need a lease contract to establish the terms that the lessee should follow. It is hard to rely on a verbal agreement or conversation because this is difficult to prove in court and people can easily forget important details that both parties have agreed upon before. With a written lease contract both parties can easily refer to the contract to settle any confusion or dispute regarding the lease.
3. How can a Contract of Lease protect you?
The Contract of Lease can protect the lessor if the lessee:
- Fails or refuses to pay rent;
- Damages the property being leased or is using the property for illegal activities;
- Overstays or fails to return the property; and
- Violates the terms of the lease (i.e. no pets allowed, no smoking policy)
In the cases above the lessor may invoke the Contract of Lease to demand that the lessee comply with the terms of the lease. If the lessee still refuses to comply the lessor may file a complaint in court to either (a) compel the lessee to comply; or (b) cancel the lease and even claim damages.
For the lessee the Contract of Lease puts in writing his rights and obligations under the lease and what is expected of him (i.e. how much rent he has to pay). The Contract of Lease also acts as a restriction on the lessor because the lessor cannot unilaterally change the terms of the lease without the lessee’s consent. For example, once the parties agree on the price of rent the lessor cannot unilaterally increase the rent without the lessee’s consent.
4. What information do you need to create the Contract of Lease?
To create your Contract of Lease you’ll need the following minimum information:
- The type of lessor (i.e. individual or business) as well as name and details (i.e. nationality and address)
- The type of lessee (i.e. individual or business) as well as name and details (i.e. nationality and address)
- The type of property to be leased and its description (i.e. address and size)
- Basic terms of the lease (i.e. amount of rent, term of lease)
5. How much is the document?
The document costs PhP 450 for a one-time purchase.
You can also avail of Premium subscription at PhP 1,000 and get (a) unlimited use of our growing library of documents, from affidavits to contracts; and (b) unlimited use of our “Ask an Attorney” service which lets you consult an expert lawyer anytime for any legal concern you have.